As discussed in our Biosmiliars Gaining Market Share post, Citigroup estimates that biosimilars could reach $110 billion in global market share by 2025, and some prescription benefit managers such as Express Scripts have already signaled their intent to adopt early, citing over $250 billion in potential savings for patients over the next decade. This fast-growing segment is making significant strides in the industry as it enters new markets. The FDA has approved four biosimilars since 2015, and these are sure to be only the first of many more.
However, with all this buzz around biosimiliars, there are some misconceptions that should be cleared up. According to PWC, an astounding 67% of consumers don’t know what a biosimilar is. Let’s discuss what all of this means:
- No exact duplications: Biosimilars are not an exact copy of the biologic they are modeled after. During the manufacturing of a biosimilar, processes can change the shape of the protein, which ultimately affect the efficacy of the drug. Because of this variance, there are no exact duplications of the branded drug that the biosimilar is modeled after. As a result, this is a main reason why the US has only approved 2 drugs.
- APAC and EU are ahead of the game: Australia, Japan, Malaysia, South Korea, and India have been leaders in adopting biosimilars, and the EU is also ahead of the US with over 22 biosimilar products approved and on the market, and several more under review.
- Approval can be a slow dance: Before you get your dancing shoes ready, let’s talk about what this really means. When a biosimilar is submitted to the FDA, this starts a “patent dance” focused on resolving any outstanding patent disputes. Because of stringent requirements, strict timelines are followed, meaning a slew of information is exchanged between the product sponsor, biosimilar applicant, and regulatory agency.
- Patents are everything: As Reuters has explained, “[t]he manufacturing process of a biotechnology drug is covered by patents. Therefore, companies making biosimilars need to be wary of patent litigations in every step of the drug manufacturing process…. About $10 billion worth of biotech drugs will go off patent by 2015.”
- The Prescription Drug Database holds the key to a plethora of information: Within the past few years, more than 36 states have considered working towards creating state-specific standards for biosimilars. The NCSL (National Conference of State Legislatures) has a prescription drug database to access state information on biologics and biosimiliars.
- Biosimilars might save money: According to the NCSL, “[s]ome legislation requires the pharmacist to explain the cost or price of the biologic and the interchangeable biosimilar. The enacted laws in Colorado, Georgia, Illinois, North Carolina and Texas require that any authorized or allowable substitution must have the lowest cost.”
- State Legislation Tally: Each state’s regulations for biologics and biosimilar vary, as the graphic below demonstrates.